For minorities, it’s even worse. The black unemployment rate is
more than twice that of whites. And the weak job market
means that even those who are employed are having a hard time
climbing the economic ladder.

Extending unemployment
payments won’t fix the employment problem.

There’s a lot of talk about helping those down on their luck,
but there’s a big divide on the best approach. Our view is that
America needs a growth agenda based on reducing the burden of
government. The unemployed need a strong job market, not endless
handouts that create dependency.

Critics have said it is “insulting” and “ridiculous” to warn
that there may be some adverse consequences to extending
unemployment insurance beyond the typical 26 weeks - even if the debate is about
doing so for the 12th time in the last five years.

We should be having a debate about whether extending long-term
unemployment benefits has consequences for the unemployed, the
employed, and America’s economy.

In 1990,
economists Bruce Meyer and Lawrence Katz released a research
paper emphasizing two important points regarding unemployment
benefits. First, unemployment levels begin to drop around the time
benefits are likely to lapse, suggesting a greater incentive for
individuals to participate in the labor force when benefits are
about to end. Secondly, they point out that unemployment benefits
do impact worker’s willingness to start new jobs, thus prolonging
the duration of unemployment.

More recently, a 2013 study by four economists from the National
Bureau of Economic Research found that, “Because unemployment
benefit extensions represent an implicit tax on market work, they
subsidize unemployment and discourage labor supply.”

Furthermore, a number of studies reflect the opinion of Harvard economist Raj Chetty, who
found that extending unemployment benefits has costs, including
extending the duration of unemployment by reducing incentives for
workers to find jobs or diminishing the intensity to join the
workforce.

Some economists on the left have argued that the results of
these studies are invalid when the job market is weak. But research
by economist Stefan Bender found that extending benefits
during a recession prolongs the duration of unemployment, even if
less so than during an economic boom.

There’s an understandable desire in Washington to “do
something,” and extending benefits once again certainly is the easy
route for policy makers. But if we are serious about keeping
workers out of the long-term unemployment trap, we must have a
debate about which policies cause unemployment and which policies
create jobs.

There are far more effective ways to help the less fortunate. Of
the 11 million unemployed, four million workers have been out of work for
over six months, a lingering consequence of the financial crisis
that resulted from misguided government policies and an
over-extended monetary policy by the Federal Reserve.

Big government is responsible for today’s unemployment
situation. More of the same won’t help. Since President Obama was
elected, we have spent $560 billion on unemployment benefits. It’s
likely many more jobs would have been created had the government
not diverted that money from the economy’s productive sector.

We need policies that unleash the private sector, encouraging
greater job creation. Instead of copying stagnant European nations
with bigger public sectors, we should learn from countries that
have achieved better performance by lowering the burden of
government.

Singapore and Hong Kong are examples of jurisdictions with small governments and
free markets that enjoy strong and sustained growth with very low
levels of joblessness. And if you somehow think that we can’t learn
any lessons from small Asian economies, look at Canada, which has
significantly boosted its jobs market with pro-growth reforms, or
Switzerland, which has cemented its traditionally strong labor
markets with reforms to control the growth of government.

This is not a partisan argument. Or at least it shouldn’t be.
The United States enjoyed strong levels of job creation during both
the Reagan and Clinton years. But in both cases, public policy was
largely the same, featuring an increase in economic freedom.

We can enact similar policies today. We’ve already made some
progress on spending thanks in part to the sequester, but long-term
fiscal sanity demands genuine entitlement reform. In addition, we
should be considering bipartisan proposals to reduce the extra
layer of tax imposed when companies repatriate profits they earned
overseas back into the United States. Augmented by other pro-growth
tax reforms, this would spur domestic investment and create
millions of jobs. And it’s time to consider a regulatory freeze or
some other policy to slow the blizzard of red tape from Washington,
which small businesses say is crippling their ability to
expand.

To argue that extending unemployment insurance is too sacrosanct
to discuss and debate is what is truly insulting and
ridiculous.